"Our strategy of focusing on top line growth
to drive operating profits higher is beginning to take hold"
William Morgenstern, Chairman and CEO
Rent-Way (RWY) reported financial results
for its fiscal 2004 first quarter ended December 31, 2003.
Rent Way reported consolidated revenues of $123.6 million
versus $119.8 million in the same quarter last year. Revenues
from Rent Way's core rental business (which excludes the
dPi Teleconnect unit) were $117.6 million versus
$111.0 million in the same quarter last year. (See our webcast
interview (audio) "It
Was Destiny" with Dave Dorwart, President of DPI teleconnect)
revenues increased 6.6% versus last year's quarter. Consolidated
operating income in the quarter was $8.5 million, up from $4.5
million in the same period last year. Consolidated net loss
allocable to common shareholders on a GAAP basis was $6.2
million, or $(0.24) per share versus a net loss of $5.4 million
last year or $(0.21) per share. GAAP net loss for the quarter
gives effect to accounting charges of $7.1 million (net),
including a non-cash accounting charge of $5.7 million related
to the conversion feature of Rent Way's preferred stock.
Without these significant items, net income allocable to common
shareholders would have been $0.9 million, or $0.03 per share.
"Our strategy of focusing on top line growth to drive operating
profits higher is beginning to take hold," stated William
Morgenstern, Rent-Way's, Chairman and CEO. "Our improvement in
comp sales performance and greatly improved operating income is
particularly gratifying. Looking forward, we will continue to
focus on top line growth and increasing our operating income."
William McDonnell, Vice President and Chief Financial Officer
stated, "We exceeded our earlier guidance on revenue and
operating income for the period. Shareholders should note the
$5.7 million charge mentioned above, the largest single non-cash
charge in the quarter, is directly related to the healthy
improvement in our stock price over the quarter. SFAS 133,
Accounting for Derivative Instruments and Hedging Activities,
requires Rent Way to evaluate the value of the imbedded
derivative in the company's $15 million preferred stock
instrument. This charge does not reflect any increase in our
cash obligations to the preferred shareholders."
The company reported EBITDA for the quarter of $12.6 million
versus $10.6 million in the same quarter last year. EBITDA as
defined by the Company is operating income plus depreciation of
property and equipment and amortization of goodwill and other
intangibles. The Company believes EBITDA provides investors
useful information regarding its ability to service its debt and
generate cash for other purposes, including for capital
expenditures and working capital. The Company reported net cash
used in operations for the quarter of $20.3 million versus $18.2
million in the same quarter last year. Reconciliations of the
non-GAAP measures mentioned above to the nearest comparable GAAP
measures is presented in the chart of supplemental information
attached to this release.
Rent-Way's Earnings Conference call will be held Today; Wednesday, February 4,
2004 at 4:30 PM (EST). The conference call is available live online and
can be accessed through
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